Special risk teams will be deployed by the Financial Services Authority (FSA) to check company books and senior executives' conduct, insurance watchdog John Tiner told Insurance Times.
The regulatory hit squads can make risk assessments at any time within the industry, including Lloyd's insurers and underwriters.
Tiner, the FSA's managing director responsible for consumers, investment and insurance, said: "We will send in risk review teams with experts in particular fields.
"We may appoint accountants if we are concerned about, say, the claims processing system. We will then interrogate the accountants about what they found."
The FSA has taken a "contracting-out agreement" with Lloyd's and will deal directly with the market's own disciplinary division, the Lloyd's Regulatory Board.
"We take on the role of competent regulator of Lloyd's on 1 December, in association with the Lloyd's Regulatory Board and David Gittings [director of regulation].
"On our behalf, they will do a lot of the day-to-day work and we will handle the additional tasks.
"We have a team dedicated to Lloyd's and that is all it will be doing. It will not be sitting back."
The FSA will assess Lloyd's syndicates' reserves, solvency and the sophisticated stress models the corporation has started producing.
However, Tiner wants to see change. "We would want to see the style and culture of the regime we have created here mirrored at Lloyd's," he said.
Director of regulation at Lloyd's, David Gittings, said the corporation had been in extensive talks with the FSA over the past two years and felt the corporation had introduced enough "rigorous" changes to comply with the new regime.
"We have devised a protocol of how this framework will work. We have done that in two respects.
One, in respect of the supervision of the market and the other is in the enforcement arrangements, where there are breaches.
"By and large, the enforcement will follow the rules. In other words, if it is a breach of a Lloyd's rule, Lloyd's will enforce it. If it is the breach of an FSA rule, the FSA is likely to enforce it," Gittings said.
Tiner is adamant he will use all his powers, which will include massive fines on company directors if they are found wanting. "If we think management has not upheld its responsibility to shareholders and policyholders, then we would look to fine them or look for other ways to seek action against them. There is no special formula - we can levy whatever fine we want. We can fine either individuals or companies," he said.